"I, however, place economy among the first and most important of republican virtues, and public debt as the greatest of the dangers to be feared."
-- Thomas Jefferson
"The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance."
-- Marcus Tullius Cicero
"If we run into such debts as that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our callings and our creeds, as the people of England are, our people, like them, must come to labor sixteen hours in the twenty-four, and give the earnings of fifteen of these to the government for their debts and daily expenses; And the sixteenth being insufficient to afford us bread, we must live, as they do now, on oatmeal and potatoes, have no time to think, no means of calling the mismanagers to account; but be glad to obtain subsistence by hiring ourselves to rivet their chains around the necks of our fellow sufferers; And this is the tendency of all human governments. A departure from principle in one instance becomes a precedent for a second, that second for a third, and so on 'til the bulk of the society is reduced to be mere automatons of misery, to have no sensibilities left but for sinning and suffering ... And the forehorse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression."
-- Thomas Jefferson
A Ponzi scheme is defined by Wikipedia as "a fraudulent investment operation that pays ... investors from their own money .., rather than from any actual profit earned by ... running the operation. The system is destined to collapse because the earnings if any, are less than the payments to investors.".
As total debt of the world's most industrialized nations ranges between twice to almost 10 times GDP (the total value of all goods and services produced domestically in a year) - it is clear that there is no realistic likelihood of ever repaying these debts. This means that, beyond any doubt, every new bond or debt instrument purchased by the latest dupe in the worldwide Ponzi scheme is counterfeit and will vanish into thin air as soon as enough come to their senses - and the whole 'house of cards' collapses!
Like a game of musical chairs no one knows precisely when the music will stop - but when it does go silent, there won't be any chairs left for anyone foolish enough to have been part of the rigged game! Debt slavery has featured in our past and is making a comeback - start today to pay down your debts!
Submitted by Tyler Durden on 02/21/2012 17:29 -0500
Today, without much fanfare, US debt to GDP hit 101% with the latest issuance of $32 billion in 2 Year Bonds. If the moment when this ratio went from double to triple digits is still fresh in readers minds, is because it is: total debt hit and surpassed the most recently revised Q4 GDP on January 30, or just three weeks ago. Said otherwise, it has taken the US 21 days to add a full percentage point to this most critical of debt sustainability ratios: but fear not, with just under $1 trillion in new debt issuance on deck in the next 9 months, we will be at 110% in no time. Still, this trend made us curious to see who has been buying (and selling) US debt over the past year. The results are somewhat surprising. As the chart below, which highlights some of the biggest and most notable holders of US paper, shows, in the period December 31, 2010 to December 31, 2011, there have been two very distinct shifts: those who are going all in on the ponzi, and those who are gradually shifting away from the greenback, and just as quietly, and without much fanfare of their own, reinvesting their trade surplus in something distinctly other than US paper. The latter two: China and Russia, as we have noted in the past. Yet these are more than offset by... well, we'll let the readers look at the chart below based on TIC data and figure out it.